-20.42% on Capriole Investments' Market Hedge Ratio touched the -20.78% signal threshold on September 4, prompting founder Charles Edwards to declare the Bitcoin bear market structurally over. Within days, an analyst known as Root, publishing at Bitcoin Strategy, reached the same conclusion from price structure alone. Neither drew on the other's data.
Market Hedge Ratio reading
Edwards' Market Hedge Ratio measures the USDT/BTC market cap ratio over a rolling 30-day window. When the ratio falls, capital rotates out of stablecoins and into Bitcoin. His chart has logged roughly nine comparable signals since January 2020. Most preceded rallies. One, in October 2021, landed near a cycle top rather than a bottom.
Edwards set an explicit invalidation: the signal holds only until the ratio turns red. The stated horizon runs weeks. He wrote that downside has been effectively capped in the past five years whenever the reading reaches this level, and that the typical outcome is a multi-week run of upside.
Root's cycle math
Root's method marks the moment Bitcoin price simultaneously reclaims the 200-day moving average, the 21-week moving average, and the short-term holder cost basis. Prior instances of that triple reclaim occurred 1,375 days and 1,384 days apart, a nine-day spread across roughly 7.5 years of data. The current breakout arrived 1,314 days after the 2023 signal, about 65 days ahead of that rhythm.
Root flagged the early timing as a complication. The cycle bottom arrived four months early by his framework; the breakout deviated considerably less. He preserved an explicit invalidation, stopping short of ruling out a continued bear market.
At the time of writing, Bitcoin was at $79,755, down 0.23% over 24 hours, with market cap near $1.6 trillion.
| Level | Value | Distance from spot |
|---|---|---|
| 21-week average | $79,355 | 0.5% above |
| Short-term holder cost basis | $70,853 | 11.2% below |
| 200-day average | $69,785 | 12.5% below |
Price holds above all three, barely. The short-term holder cost basis and 200-day average sit roughly $1,000 apart, a support shelf near $70,000 that Grayscale separately identified as its own bottom zone. A weekly close below $79,355 breaks both theses simultaneously.
The two frameworks share almost no methodology: Edwards measures a 30-day stablecoin flow ratio; Root measures years of cycle structure. They published within the same week in early September and arrived at the same directional conclusion from opposite ends of the analytical spectrum.